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Altisource Underwriter / Processor Test

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Altisource Underwriter / Processor Test
Tim Mergler
Quiz by Tim Mergler, updated more than 1 year ago
Tim Mergler
Created by Tim Mergler about 8 years ago
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Resource summary

Question 1

Question
Under the Homeowners Protection Act, borrowers can request that lenders cancel PMI when their loan balance is less than ____, or a lender may collect PMI until ____ loan-to-value is reached.
Answer
  • 65%; 50%
  • 78%; 62%
  • 80%; 65%
  • 80%; 78%

Question 2

Question
What is the purpose of Regulation B?
Answer
  • To prohibit discriminatory treatment of credit applicants
  • To require disclosure of settlement costs
  • To regulate referral fees
  • To prohibit misleading advertisements for mortgage loans

Question 3

Question
The Real Estate Settlement Procedures Act (RESPA) applies to:
Answer
  • Residential loans
  • Residential lot loans
  • Commercial loans
  • Residential investment properties such as condos and duplexes

Question 4

Question
A(n) __________ is a loan with an interest rate that is adjustable and also offers a borrower a number of payment choices, such as 30- or 15- year P&I, interest-only, or a 1% minimum payment, which may result in negative amortization.
Answer
  • Adjustable- rate mortgage
  • 3/1 ARM
  • Payment Option ARM
  • Reverse mortgage

Question 5

Question
What does the acronym “APR” mean?
Answer
  • Appraised property ratio
  • Adjusted pricing ratio
  • Annual percentage rate
  • Annual percentage ratio

Question 6

Question
MIP would be used for which of the following?
Answer
  • A conventional loan with a down payment of less than 20%
  • A non-conforming loan
  • An FHA loan with a 3.5% down payment
  • VA loan with a 10% down payment

Question 7

Question
Which of the following loan programs does not require credit or income documentation and does not require repayment as long as the owner lives in the home?
Answer
  • NINA
  • Reverse mortgage
  • Option-ARM
  • HELOC

Question 8

Question
Increasing loan balances resulting from the application of periodic payments that are not sufficient to cover the interest that is due will result in:
Answer
  • Negative equity
  • Negative amortization
  • Lower credit scores
  • Amortizing payments

Question 9

Question
Concerning ARMs, margin is best defined as:
Answer
  • The amount of compensation earned by a mortgage professional for originating an ARM
  • The range of flexibility an interest rate has between caps on traditional ARMs
  • The maximum – up or down – that an interest rate can ever adjust on an ARM
  • A number, expressed as a percentage, that represents a lender’s operating costs and profit margin

Question 10

Question
Which of the following best describes the LTV ratio?
Answer
  • It is the ratio of the borrower’s total debt to monthly income
  • It is the ratio of the borrower’s principal loan balance to the appraised value of the property
  • It is the ratio of the borrower’s monthly loan payment to the principal loan balance
  • It is the ratio of the borrower’s monthly housing expense to monthly income

Question 11

Question
Which of the following best describes what is considered in the calculation of a borrower’s back-end ratio?
Answer
  • Principal and interest payments
  • The cost of credit in relation to the value of the loan
  • All consumer debt such as credit card payments and auto loan
  • The total amount of monthly payments on long-term debt carried by the consumer

Question 12

Question
Which of the following does a lender use to analyze a borrower’s financial capacity to determine if he/she is able to afford a loan?
Answer
  • LTV
  • CCPA
  • CIP
  • DTI

Question 13

Question
Comparable properties used in the market approach to appraisal should be located within ____________ of the subject property.
Answer
  • One mile
  • Five miles
  • The same zip code
  • The same county, city or township

Question 14

Question
According to conforming guidelines, an appraiser may make net adjustments to comparables of up to _____ in a residential appraisal.
Answer
  • 25%
  • 20%
  • 15%
  • 10%

Question 15

Question
Property flipping occurs when:
Answer
  • The title of a property is passed to a family member
  • Someone accepts a fee to falsely claim ownership of a property
  • Someone secures a loan with fictitious property
  • A property is bought and resold within a very short period of time

Question 16

Question
A borrower in a mortgage transaction is called:
Answer
  • A lendee.
  • A mortgagee
  • A mortgagor
  • A beneficiary

Question 17

Question
A clause in the note that requires the borrower to pay an additional charge if he prepays the loan is:
Answer
  • The prepayment penalty.
  • The due-on-sale clause.
  • The late payment penalty.
  • The prepayment privilege.

Question 18

Question
Which IRS form authorizes the lender to obtain income tax information?
Answer
  • 8821 or 4506-T
  • W-2
  • 1099
  • Schedule C

Question 19

Question
For a sole proprietorship, the income, expenses and taxable profits are reported on:
Answer
  • IRS form 1065
  • Schedule E attached to IRS form 1040
  • IRS form 1120
  • Schedule C attached to IRS form 1040

Question 20

Question
In the calculation of an applicant's income, a capital gain can be considered if:
Answer
  • It is a one-time occurrence
  • The borrower has occasionally sold capital assets
  • The borrower owns additional capital assets
  • It occurred no earlier than six months prior to the application
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